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There are plenty of reasons the Phillies would want to trade Papelbon. He is owed $26 million over the next two seasons

No, he's owed $39M/3 unless he doesn't finish 100 games the next 2 years (which he's done every 2 years of his career since his first full year).

If I'm Houston I'd take him for free, make him a setup man for first month or two so he's unlikely to finish 100 games the next two years, then showcase him for contenders hoping to flip him at deadline. I'm thinking if he shows any rebound at all, a contender would be very willing to part with a pretty prime prospect if I eat his 2014 salary and his 2016 vesting option is dead. Essentially a year and a half of Pap at $13M seems like it would be catnip to any contender with a weak bullpen (hello Detroit!).

Of course this fantasy can never come true given his no trade clauses.

Leave it to RAJ to decide trading him makes sense at the point where his value is likely to be the lowest. Moving him at the trade deadline last year, or waiting for it this year, would make too much sense.